Bayley v Kaida Company Ltd

• Jurisdiction: Barbados
• Judge: Williams, J.
• Judgment Date: 15 August 1983
• Neutral Citation: BB 1983 HC 60
• Docket Number: No. 1046 of 1982
• Date: 15 August 1983
• Court: High Court (Barbados)

High Court. (Civil Jurisdiction)

Williams, J.

No. 1046 of 1982

Bayley

and

Kaida Co. Ltd.

Appearances:

Mr. E.E. Alleyne for the plaintiff

Mr. R.L.M. Clarke for the defendant.

Contract - Breach — Marketing of goods

Contract - Marketing of goods — Non — delivery

Williams, J.

1 The plaintiff (hereinafter referred to as “Hope”) carries on business as an importer and exporter, a commission agent and a distributor under the trade name of Hope International Trading. Mr. Austin Bayley is manager.

2 The defendant (hereinafter referred to as “Kaida”) is a company which manufactures food products. Dr. Reginald Clarke is its President.

3 In early 1981 Hope and Kaida made agreements relating to the marketing of Kaida's products. On the 27th of January agreement was made for Hope to market Kaida's products in the Windward and Leeward Islands and Puerto Rico. Hope for its part guaranteed to Kaida minimum annual sales of $200,000. And in April it was agreed that Hope would market Kaida's products in Barbados, Hope guaranteeing a minimum sales value of $500,000. Both these agreements were confirmed in writing and signed by Mr. Bayley and Dr. Clarke on behalf of Hope and Kaida respectively.

4 The business in the Barbados market was conducted at first on a cash, but subsequently on a credit, basis. Hope, after credit was given, would collect the goods from Kaida at ex factory prices, mark them up to prices which allowed for Hope's expenses and commission or profit, sell them and pay Kaida within the period over which credit was extended, apparently 30 days.

5 Business on the markets of the Windwards and Leewards was conducted on a different basis. Hope would purchase the goods at ex factory prices and export them at prices which allowed for Hope's expenses, including insurance and freight, and Hope's commission or profit. Kaida's terms would be cash and the goods would be delivered to Hope after payment or receipt of an assurance from the Bank that the funds had been credited to Kaida's account. It is convenient to refer here to the evidence of Mr. de Gannes, the manager of the Marhill Street branch of the Canadian Imperial Bank of Commerce, Hope's, and subsequently also Kaida's, banker –

“The Bank had certain guarantees from the Central Bank in relation to Hope International. So that they could pay factory costs … Central Bank did not in guarantee outline that we could deal with Facey Commodity… A guarantee from Central Bank in place for specific overseas customers. First guarantee on28th January, 1981. Guarantee covered specific instances… shipping documents would be presented to the Bank sometime after payment to Kaida for goods. In context of guarantee. Each time Dr. Clarke would call me and said he wanted to deliver goods to Mr. Bayley. He did ask if I am going to pay him or credit his account. I would confirm or deny as case may be. In the beginning we used to pay by official draft. Not a customer at time. Give Hope an official banker's draft. Hope would have to bring invoice from Kaida. No guarantee from Central Bank in relation to Facey Commodity…..”

6 My understanding of this evidence is that, in relation to goods exported by Hope to the Leewards and Windward Islands, a guarantee from the Central Bank enabled the Bank to pay Kaida on the strength of an invoice presented by Hope who would then be able to collect the goods from Kaida's factory, deliver them to the shippers, obtain the bill of lading and other necessary documents and in due course receive payment from which the Bank would be reimbursed. If anything went wrong the Bank would be covered by the Central Bank guarantee.

7 Now to the Jamaican market. It is pleaded in paragraph 3 of the Statement of Claim that Kaida appointed Hope sole marketing agent in Jamaica for its products. This is denied by Dr. Clarke who testifies that Mr. Bayley requested the Jamaican and Trinidadian markets on more than one occasion but he refused on each occasion the request was made. Kaida points to the written confirmation of the agreement in the case of Barbados, the Windward and Leeward Islands and Puerto Rico. Why, it is asked, is there no like written confirmation in relation to Jamaica if there was such an agreement?

8 I must consider the totality of the evidence including –

• (a) Mr. Bayley's presence and assistance at the Kaida booth at the exhibition in Jamaica. Dr. Clarke's evidence is that he did not expect him and had to alter the arrangements he had made for attendance at the booth. Mr. Bayley on the other hand testified that he had arranged to be present and his visit to the exhibition was no surprise to Dr. Clarke;

• (b) the order placed with Hope. Why was the order made out to Hope? Why was Mr. Winston Bayley's letter to Dr. Clarke of the 2nd of September copied to Mr. Austin Bayley of Hope? Mr. Austin Bayley replied to the letter on the 16th of September and Mr. Atkinson responded to Mr. Austin Bayley on the 6th of October copying his letter to Dr. Clarke. How is all this to be explained? Dr. Clarke's story is that he was negotiating throughout with Mr. Winston Bayley of Facey Commodity Company Limited (hereinafter called Facey) and it was at the conclusion of the final meeting when Mr. Winston Bayley asked how the letter of credit was to be established that Mr. Austin Bayley shouted “Hope International”. Dr. Clarke went on to explain that his silence at the time was to avoid embarrassment to Mr. Austin Bayley who subsequently told him why he had done it — that he had lost two orders for $100,000 because Dr. Clarke refused to supply him with stuff to sell to other people in Jamaica and sales in Barbados were dropping because Hope needed another vehicle. Dr. Clarke went on to say that Mr. Austin Bayley apologised and he, Dr. Clarke, promised that he would see if he could do anything with the prices in order that Hope could get something out of the sale. Dr. Clarke further stated that it was in the plane out of Jamaica when he first discovered that the prices set out in the order placed by Facey were inflated and not at the level which he had authorised.

9 It is clear from Mr. Winston Bayley's evidence and his letter to Dr. Clarke of the 2nd of September (Exhibit “B”) that the terms of business between Kaida and Facey were concluded with Dr. Clarke....